Why Are Some Institutions Above the Law?

It amazes me how some institutions, both public like our government, and private institutions can arbitrarily create their own rules that supersede written laws. You can be quite capriciously not admitted to an antiques dealer association as easily as being denied acceptance into a country club. And just as randomly, you could be expelled for an action erratically enforced by the group.

Private schools and the enforcement of their rules on expulsion are meant to intimidate both students and parents on their one-sided methods to maintain control of the actions of both. Step out of line and your transcript will be blemished. The methods to control the situation by the institution are commiserate with how damaging was the cause and enforcement of the student expulsion. Embarrassing situations are always the best PR. Lies, deception, fraud, intimidation, these things however don’t enhance one’s image.

The risk of suing for “justice” from the wrong inflicted by any institution can be a frightening task. The shield that a private organization is surrounded with can be quite impenetrable. As the membership or acceptance by the institution comes from within, there is the same instinctive need within the group to survive without that member. Survival of the institution is based on the need for a controlling interest in the group to take the initiative. It could be civil servants or a board of directors; it could be management or a wealthy interest group. The cost of litigation to break the institution from wrongful control can be daunting when measured against actually winning. The emotional toll also has a significant cost.

Discrimination is term that connotes lost opportunity. Institutions that base their membership on any form of this really could be missing the prospect of enhancing the group. Maintaining a certain level of requisite wealth or skills needed by the organization to function is of paramount purpose to survive. However when an institution bends the law to insulate itself from a threat to its control of its marketplace, the stakes for manipulation gets higher. Just ask Microsoft or Google how they approach threats to their turf.

Of course this thought gets me back to the Sotheby’s/Christie’s duopoly in the art and antiques industry. These two branded institutions have controlled the market with lies (undisclosed conflicts of interest), deception (secret reserve), fraud (irrevocable bid kickback), intimidation, and oh yes, price fixing (an ever rising, non-negotiable buyer’s premium). Their growth and survival have depended upon these methods. Perhaps President Obama’s recent justice department statements to pursue antitrust practices can find its way into this state of affairs.